Marvell's AI Bookings Are Stellar. But Its Gross Margin Guide Is What Moved the Stock.

Marvell Technology reported record Q2 fiscal 2027 revenue of $2.739 billion (up 37% YoY) and raised full-year guidance, but the stock fell 8% after-hours due to declining gross margins. Non-GAAP gross margin decreased from 59.4% a year ago to 58.9%, with Q3 guidance at 57.5-58.5%, driven by a growing custom AI chip business with lower margins that now represents a significant portion of revenue.